S.B. 45

1

TOBACCO SETTLEMENT ACCOUNT
2 APPROPRIATION
3 2000 GENERAL SESSION
4 STATE OF UTAH
5 Sponsor: Robert F. Montgomery
6 AN ACT RELATING TO STATE AFFAIRS IN GENERAL; REQUIRING THAT THE
7 HOSPITAL PROVIDER ASSESSMENT BE REDUCED TO THE EXTENT TOBACCO
8 SETTLEMENT MONIES ARE APPROPRIATED FOR THE CHILDREN'S HEALTH
9 INSURANCE PROGRAM; APPROPRIATING FUNDS FROM THE TOBACCO
10 SETTLEMENT ACCOUNT FOR FISCAL YEAR 2000-01; AND PROVIDING AN EFFECTIVE
11 DATE.
12 This act affects sections of Utah Code Annotated 1953 as follows:
13 AMENDS:
14 26-40-103, as last amended by Chapters 21 and 61, Laws of Utah 1999
15 26-40-111, as enacted by Chapter 360, Laws of Utah 1998
16 26-40-112, as last amended by Chapter 78, Laws of Utah 1999
17 Be it enacted by the Legislature of the state of Utah:
18 Section 1. Section 26-40-103 is amended to read:
19 26-40-103. Creation and administration of the Utah Children's Health Insurance
20 Program.
21 (1) There is created the Utah Children's Health Insurance Program to be administered by
22 the department in accordance with the provisions of:
23 (a) this chapter; and
24 (b) the State Children's Health Insurance Program, 42 U.S.C. Sec. 1397aa et seq.
25 (2) The department shall:
26 (a) prepare and submit the state's children's health insurance plan before May 1, 1998, and
27 any amendments to the federal Department of Health and Human Services in accordance with 42

28 U.S.C. Sec. 1397ff; and
29 (b) make rules in accordance with Title 63, Chapter 46a, Utah Administrative Rulemaking
30 Act regarding:
31 (i) eligibility requirements consistent with Subsection 26-18-3 (6);
32 (ii) program benefits;
33 (iii) the level of coverage for each program benefit;
34 (iv) cost-sharing requirements for enrollees, which may not:
35 (A) exceed the guidelines set forth in 42 U.S.C. Sec. 1397ee; or
36 (B) impose deductible, copayment, or coinsurance requirements on an enrollee for
37 well-child, well-baby, and immunizations;
38 (v) the administration of the program; and
39 (vi) the provider assessment, including:
40 (A) the factor for the assessment;
41 (B) the administration, collection, and enforcement of the assessment, including:
42 (I) auditing a provider's records; and
43 (II) imposing penalties for failure to pay the assessment as required; and
44 (C) reducing the amount of the assessment [to the extent funds are deposited into the
45 Hospital Provider Assessment Account created in Section 26-40-112 as a result of private
46 contributions to the program] in accordance with Section 26-40-111 .
47 (3) Before July 1, 2001, the Governor's Office of Planning and Budget shall study the
48 effectiveness of the department's administration of the program and report any findings to:
49 (a) the Health and Human Services Interim Committee of the Legislature;
50 (b) the Health Policy Commission; and
51 (c) the department.
52 Section 2. Section 26-40-111 is amended to read:
53 26-40-111. Provider assessment.
54 (1) Other than for the imposition of the assessment described in and utilized for the
55 purposes of the chapter, nothing in this chapter affects the nonprofit or tax exempt status of any
56 nonprofit charitable, religious, or educational health care provider under 26 U.S.C. Sec. 501(c),
57 as amended, or other applicable federal law, or under any state law, or any activities of or property
58 owned by any such provider with respect to exemption from ad valorem property taxes, income

59 or franchise taxes, sales or use taxes, or any other taxes, fees, or assessments whatever, whether
60 imposed or sought to be imposed by the state or any political subdivision, county, municipality,
61 district, authority, or any agency or department thereof.
62 (2) For providers subject to the assessment imposed by this chapter, and also subject to
63 the corporate franchise or income tax under Title 59, Chapter 7, Corporate Franchise and Income
64 Taxes, all assessments paid under this chapter shall be allowed as a deductible expense under Title
65 59, Chapter 7.
66 (3) Beginning on July 1, 1998, a uniform, broad-based, quarterly rate of assessment is
67 imposed on each hospital, hospital-based ambulatory surgical facility, and freestanding ambulatory
68 surgical facility in accordance with department rule, which assessment:
69 (a) may not exceed $5,500,000 in the aggregate in any fiscal year; and
70 (b) shall be reduced [to the extent that funds are deposited into the Hospital Provider
71 Assessment Account created in Section 26-40-112 as a result of private contributions to the
72 program. (4) A reduction in assessment that occurs as a result of Subsection (3)(b) shall apply to
73 as many subsequent fiscal years as is possible based on the total amount of funds deposited into
74 the restricted account.] each fiscal year by the amount of funds that are:
75 (i) appropriated to the department to reduce the assessment for that fiscal year; and
76 (ii) available in the Hospital Provider Assessment Account at the start of the fiscal year
77 to fund the program.
78 (4) The department may not impose the assessment in any fiscal year in which the amount
79 of the assessment has been reduced to zero as a result of Subsection (3)(b).
80 (5) The department shall forward proceeds from the assessment imposed by this chapter
81 to the state treasurer for deposit into the Hospital Provider Assessment Account created in Section
82 26-40-112 .
83 Section 3. Section 26-40-112 is amended to read:
84 26-40-112. Hospital Provider Assessment Account.
85 (1) There is created within the General Fund a restricted account known as the "Hospital
86 Provider Assessment Account."
87 (2) The account shall be nonlapsing and consist of:
88 (a) proceeds from the assessment imposed in accordance with Section 26-40-111 ;
89 (b) funds transferred from the Medicaid Hospital Provider Temporary Assessment

90 Account;
91 (c) private contributions; [and]
92 (d) interest earned on monies in the account[.]; and
93 (e) funds that are appropriated to the account from the Tobacco Settlement Account
94 established in Section 63-97-102 .
95 (3) Funds in the account shall be appropriated by the Legislature to fund:
96 (a) the program; and
97 (b) if funds remain after Subsection (3)(a), the Medicaid program.
98 (4) No more than $5,500,000 may be appropriated from the account in any fiscal year.
99 (5) Any funds remaining in the account at the end of a fiscal year shall be used to reduce
100 the next fiscal year's provider assessment in the manner provided for in Section 26-40-111 .
101 Section 4. Appropriation.
102 (1) There is appropriated for fiscal year 2000-01 from the Tobacco Settlement Account
103 within the General Fund:
104 (a) $5,500,000 to the Department of Heath for the Children's Health Insurance Program
105 and the reduction of the provider assessment established in Section 26-40-111 to zero for fiscal
106 year 2000-01;
107 (b) $4,100,000 to the Department of Health for tobacco prevention, reduction, and control
108 programs;
109 (c) $650,000 to the Administrative Office of the Courts and $4,350,000 to the Department
110 of Human Services for the statewide expansion of the drug court and tobacco court programs; and
111 (d) $160,000 to the Department of Corrections, $80,000 to the Board of Pardons and
112 Parole, and $560,000 to the Department of Human Services for the creation and operation of a
113 Drug Board Pilot Program for substance abuse offenders in the Ogden and Farmington Regions
114 of Adult Probation and Parole.
115 (2) Nothing in this section may be construed as restricting the ability of the Legislature to
116 appropriate for fiscal year 2000-01:
117 (a) any amount remaining in the Tobacco Settlement Account following the appropriation
118 required by Subsection (1); or
119 (b) any amount anticipated to be received in tobacco settlement monies during fiscal year
120 2000-01.

121 Section 5. Effective date.
122 This act takes effect on July 1, 2000.




Legislative Review Note
as of 12-13-99 3:10 PM

A limited legal review of this legislation raises no obvious constitutional or statutory concerns.

Office of Legislative Research and General Counsel